For example, the Comprehensive Implementation Plan for Improving Energy Saving and Environmental Performance of Coal-Fired Boilers (or the Boiler Action Plan) introduced in 2014 includes the phasing out of obsolete coal-fired boilers with a combined capacity of generating 400,000 tons of steam an hour by 2018, and all the companies included in such programs have been mandated to meet the government's target irrespective of the financial consequences.

Over the past 10 years, the government has introduced a number of policies and programs to phase out carbon-intensive technologies (such as green building standards, fuel quality and eco-labeling), causing a change in the carbon-intensive technology market.

Moreover, the past five years have seen more Chinese people manifest "green consumer" behavior. Chinese consumers are among the most concerned in the world about the environment, according to Greendex surveys conducted between 2009 and 2014. And the rising number of "green consumers" have brightened the prospects of many market segments.

Also, the number of companies in China that prepare their corporate social responsibility reports increased from 18 in 2006 to 2,032 in 2014. This shows the speed at which companies are integrating sustainability goals into their long-term strategies.

However, climate change has undermined the companies' ability to achieve those goals. Many climate-related disasters push the most vulnerable groups back into poverty and neutralize the progress made by the companies toward sustainable growth. For example, in 2014, the drought in Henan province caused a direct economic loss of 7.3 billion yuan, 97 percent of it in the agricultural sector, and the devastating floods in five provinces in southern China affected 1.2 million people.

Since China-based companies are exposed to all the risks discussed above, they have no choice but to take concrete measures to mitigate them and enhance their adaptability and competitiveness in the long run.

Xiaochen Zhang is associate director of Climate Change at Business for Social Responsibility, and Qimin Chai is deputy director of Strategy and Planning Department of the National Center for Climate Change Strategy and International Cooperation.

(China Daily 12/12/2015 page5)